Whats best for us??? Bankrupcy????

bcljnk

Right i met my hubby just over 7 years ago, and i that time we have got ourselves in a bit of a pickle, we were both married before, and niether had any so called debts, i had a credit card, but never had much on it and always paid it off in full each month, hubby had a payment thing were he bought a PC years ago and was paying it back via a payment book. never ending, i convinced him to pay more money on it and pay it off, i do have a good brain for this kind of thing normally, well till now, sorry this will be long, apologies in advance.
To get to the point, after we got together i got a loan for a people carrier, as we had 5 kids between us, and as time has gone on, and the need for 2 cars as i have to have one, and hub needs one for work the loan has been replaced a couple of time with bigger ones, to pay off the old one, and get newer cars, plus we have had to use credit cards sometimes to tide us over, putting them over onto 0% interest to keep costs down, this has now mounted to one at £3000, and a smaller one of £450, with the loan being just under £15000.
Now like i have said i have always been very good at sorting out our finances, but by next april things will change dramatically with our finances, we have been getting DLA and carers allowance for my stepson who lives with us and has aspergers, but we have just filled out the new forms and have truthfully had to put that he is actually getting a little better, so dont think this will be re instated by april, so £176 dla a monthplus £46 carers all a week, less which will be a lot, then my oldest will be 16 and our child tax credits, child benefit will stop if she doesnt stay on in education, and we obviosly get the premiums at the minute for getting the dla, which will be reduced, ie less child tax credit.
So a quick rundown is we will be a lot less off by april, and theres no way we can juggle our figures to compensate, would i be better just making myself bankrupt given the loan is in my name??
B

mountainofdebt

Firstly welcome to MSE.

What I would do is post details of all your outgoings (with full details of debt, limits and aprs) and income so we can see where savings can be made.

I don't think going bankrupt should be taken lightly especially if there are alternatives. As a side issue I think it might be seen as a luxury having two cars so if you did go bankrupt then you would probably be forced into selling one of them at least.

Gemmzie

Hi bcljnk, welcome to the boards. Best thing to do is to post an SOA, see the sticky at the top of the board.

Between the five children, one is 16, what about the others?

With your stepson being a little better they may just remove carer's allowance and lower the rate of the DLA, as far as I know, DLA is usually only removed if there is no longer any care or mobility issues. And please, always get a Welfare Officer to fill the forms in

bcljnk

Thankyou for the replies, as it stands we are doing fine, never missed a payment, and not to bad at the end of the month, although its only a few pounds its better than struggling.
As for doing an in/outgoing expenditure there isnt much point at the minute as like i say we manage its just IF things do change in april which i think they will thats when it will hit us HARD, i have the £3000 CREDIT CARD ON NO INTEREST AT THE MINUTE, about 9 months left, and the loan was taken out on a good low interest at 6. something, so wouldnt be able to lower that, basically i would prefer NOT to go brankrupt, as i dont want to lose my bank accounts and my debit facility, obviously not bothered about losing credit cards, thats whats got me here, and i am afraid luxury or not 2 cars are essential for us as i have to drive the kids to and from school, and hubby works out of town, so would need his car, we dont own our property so that was never a problem.
My oldest decided to do a hissie fit a couple of months ago and went to stay with her gran, i declared her not living here as they needed the cash, and then the week after she came home, so for 6 weeks of her messing about it messed our finances up big time, and just through that we are now lower in child tax, i now owe council tax which i didnt before and my housing benefit, although wasnt much has also been lowered because of the time scale of things being processed, so i know that come april when she is 16 i will lose the money again, plus maybe the dla and carers, so it will go down substantially, best thing i think will be to wait and see what happens financially, i just dont want to go down the route of struggling with 5 kids, who are t the minute, 15, 13, 12, 10 and 5.
Thanks once again

CLAPTON

its up to you of course but if you post your SOA maybe people will see ways of economising that may help you.

presumably, if one of your children leaves fulltime education they will get a job and will then contribute to the housekeeping.

Millionare

bcljnk wrote:

As for doing an in/outgoing expenditure there isnt much point at the minute as like i say we manage its just IF things do change in april which i think they will thats when it will hit us HARD, i

There's not much anyone can advise until you do a SOA. the whole point of your post is to advise in advance "IF" things hit hard in april.

Only thing advisable is bankruptcy could mean losing "A" car or both and/or having to sell the cars for cheaper models. all depends though on a individual basis and how much they are worth. also you may be put on a IPA if you a surplus income over £100 for 3 years in bankruptcy.

bcljnk

SOA
As now

Monthly Incomings:

My child tax credits - £782
Partners salary - £480.....part time due to stepsons aspergers
Tax credits - £117.24
housing benefit - £106.52
Maintenance -£50-he has them 3 days a week, so pays less, mutual agreement
DLA - £176.60
Carers allowance - £187.80
Child benefit - £257

Total - £2157.16

Monthly Outgoings:

Loan - £224.16
Visa's - £150 min, 200max if i can afford it
Rent - £330
Council Tax - £90
Gas - £65
Electric - £65
Water rates - £30, approx for both fresh and sewerage
TV License - £10.99
Sky £21...cancelling if we start to struggle before april
Phone - £40
Broadband - £17.99
Food - £400...7 people
Car Insurance - £50....2 cars
Petrol - £120
Life Insurance £32....3 policies
Pet insurance £10.63
Mobile phone £30...contract up in june, going on PAYG

TOTAL OUTGOINGS £1686.77
£470.39 left

I dont know what is accountable and what isnt or if i have forgotten anything, but like i said we are pretty much ok at the minute, but i havnt put things down like kids needing new clothes, haircuts, shoes, school trips, and other bits and bobs or holidays, come april child tax credits will go down, may lose DLA and carers, and child benefit for one, If my oldests stays on in school then that wont stop, but i 'think' she will leave home ASAP, she is that kind of child, wants her independance:mad:

So thats about it really

bcljnk

Forgot car tax, xmas pressies for 6 kids, plus birthdays, have another stepdaughter to buy for who doesnt live with us, having put it down and see how much we have left each month makes me wonder were it all goes????

Smashing

bcljnk wrote:

Forgot car tax, xmas pressies for 6 kids, plus birthdays, have another stepdaughter to buy for who doesnt live with us, having put it down and see how much we have left each month makes me wonder were it all goes????
Michelle

You need to start a spending diary asap - let no money go unaccounted for.
As for cancelling SKY etc. if things start to get difficult - don't wait until the storm to thatch the roof. Far better to remain firmly on top of things rather than just 'get by.'

hypno06

Smashing wrote:

You need to start a spending diary asap - let no money go unaccounted for.
As for cancelling SKY etc. if things start to get difficult - don't wait until the storm to thatch the roof. Far better to remain firmly on top of things rather than just 'get by.'

I agree. Start a spending diary straight away and write in it absolutely everything - even if it is only a few pence. That way you will see what you really do need to spend and what you can easily cut out without really missing it.

Better to start reducing now, then you will be prepared should things need it in April. Of course, if the income does not reduce in April, you will be able to continue with the reduced spending and save the rest for a rainy day!

bcljnk

Excellent idea, thanks, infact we were discussing it last night, and have decided that we will get rid of the ford galaxy, (oldest hardly goes out with us any more, so we could manage) its only an old one, and wont bring much money in, but its cost us a lot just for that, bought last dec for £3000, had it 6 weeks (private sale) and then it needed a new engine, which cost us £1500 so we wont recoupe any of that back, but might get a couple of grand for it which will pay off the visa:j :j then we wont have the expence of 2 cars, just will mean i have a long walk to pick one of the kids up, but hey he moves to secondery in sept, so not long, not a problem in the mornings as hubby doesnt go to work till after the kids have gone to school, do shopping in the evenings if i have to and use public transport.
Phew feeling a little brighter already